Ken Hoagland v. Bill Butcher, Kari Butcher, Butcher & Butcher, and OCTV Partners, LLC
396 S.W.3d 182
Tex. App.2013Background
- Hoagland, plaintiff, challenged a trial court order granting special appearance and dismissing the case against Butcher & Butcher, AFFT, and OCTV.
- Affiliates formed to promote the FairTax Campaign; AFFT is Texas-based for purposes of the claims, while Butcher & Butcher and OCTV are California entities.
- Hoagland alleged in Texas that defendants made misrepresentations and frauds to induce him to enter and continue a contract and to fund the infomercial campaign.
- Key Texas-establishing actions included board meetings in Houston and a telephone call, with alleged misrepresentations about finances and performance.
- OCTV-AFFT Agreement funded via Houston escrow; Hoagland allegedly accepted a reduced fee under pressure from Bill Butcher.
- Trial court granted defendants’ special appearance and dismissed; on appeal, Hoagland argued jurisdiction existed under Texas long-arm statute.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Hoagland plead sufficient jurisdictional facts? | Hoagland pleaded torts in Texas, satisfying § 17.042(2). | Plaintiff failed to plead facts showing Texas torts; defendants negated jurisdiction. | Hoagland pleaded sufficient jurisdictional facts. |
| Must defendants negate every basis for jurisdiction? | Plaintiff's pleadings show torts in Texas; defendant bears burden to negate all bases. | Defendants can negate jurisdiction on factual or legal grounds. | Defendants failed to negate every basis; jurisdiction remains. |
| Is there specific personal jurisdiction based on purposeful availment? | Board meetings in Texas and a Texas phone call show purposeful availment relating to the fraudulent scheme. | Attending meetings and calls are insufficient unless tied to the plaintiff’s claims. | Specific jurisdiction established; acts relate to the alleged fraud and contracts. |
| Do traditional notions of fair play and substantial justice support jurisdiction? | Texas has a strong interest; burden on defendants is manageable; forum is proper. | Not sufficiently shown that exercising jurisdiction would be fair or just. | Jurisdiction consistent with fair play and substantial justice. |
Key Cases Cited
- Kelly v. Gen. Interior Constr., Inc., 301 S.W.3d 653 (Tex. 2010) (plaintiff must plead jurisdictional facts; burden shifts to defendant)
- Horizon Shipbuilding, Inc. v. Blyn II Holding, LLC, 324 S.W.3d 840 (Tex.App.-Houston [14th Dist.] 2010) (untimely or unsupported jurisdictional assertions negated)
- BMC Software Belgium, N.V. v. Marchand, 83 S.W.3d 789 (Tex.2002) (de novo review of special appearance when facts disputed)
- Am. Type Culture Collection, Inc. v. Coleman, 83 S.W.3d 801 (Tex. 2002) (presume factual disputes resolved in favor of trial court in no-fact-findings cases)
- Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777 (Tex. 2005) (purposeful availment, minimum contacts, forum-state interests)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (U.S. 1985) (purposeful availment as touchstone of jurisdictional due process)
- Guardian Royal Exch. Assurance, Ltd. v. English China Clays, P.L.C., 815 S.W.2d 223 (Tex. 1991) (traditional notions of fair play and substantial justice in jurisdiction)